At the beginning of the industrial 4.0 revolution, with the deep integration of new information technology and advanced manufacturing technology, manufacturing enterprises can interact positively with leading users in product individualized manufacturing to meet consumers’ individualized needs. Due to the deficiencies in operation mode, business process and organizational structure, the traditional supply chain can not effectively support the individualized manufacturing of products, which urgently needs transformation and upgrading. Considering the separation of manufacturing and marketing and the integration of customization in personalized product supply chain, the two operation models are modeled and solved in competitive and non-competitive environments. On the basis of a practical case, the supply chain operation strategy and profit difference between the two operation models by Example simulation are compared and analyzed, and then the research conclusion on the influence of individualized product supply chain upgrading from separation of manufacture and marketing to integration of customization on its operation performance is given. The basic ideas of the study are as follows: First, the basic assumptions of this study are given. Secondly, the game model of individualized product supply chain is constructed and solved under four scenarios: non-competitive environment and manufacturing-marketing separation structure, non-competitive environment and customization integration structure, competitive environment and manufacturing-marketing separation structure, competitive environment and customization integration structure. Finally, a practical example is used to simulate the game equilibrium results. The results show that: Compared with the structure of separation of manufacturing and sales, the individualized product supply chain choices the structure of customization integration is conducive to matching product individualized manufacturing, improving the level of product individualization, improving the market demand of individualized products and increasing the expected revenue of the supply chain.Moderate wholesale price contract incentive can promote product individualized manufacturing, enhance the level of product individualization and market demand, and improve the performance of supply chain and its members when the individualized product supply chain chooses the structure of separation of manufacturing and sales, meanwhile moderation transfer of profits by distributors to increase the wholesale price contract incentive coordination can significantly promote democratic manufacturing and enhance the level of product individualized.Excessive competition will reduce performance of individualized product supply chain,but chooses the structure of customization integration can significantly enhance competitiveness. On the basis of introducing the case of transformation and upgrading of the supply chain of red collar individualized products, simulation and comparative analysis of the game equilibrium results under four scenarios are carried out. The research results enrich the decision-making theory of the competitive supply chain of individualized products, it provides theoretical support and method reference for scholars to study the structure design of individualized product supply chain, and it has important guiding significance for the management practice of the transformation and upgrading of the supply chain of individualized products.